Human induced pluripotent stem cells (iPSCs) have the potential to treat many diseases by autologous transplantation. However, before they can be used clinically, efficient and reproducible methods are required for their derivation and differentiation into therapeutic cell types. In the case of genetic diseases, methods for correcting disease-causing mutations also need to be developed. Here we will use this approach to design a treatment for thalassemia, which is caused by mutations in globin genes. This approach avoids the potential genotoxic complications of conventional gene therapy with retroviral vectors and should achieve consistent, regulated globin expression from the endogenous locus. We will derive IPSCs from the adult cells of patients with thalassemia using lentivirus and foamy virus vectors that express reprogramming transgenes. Some of the vectors will be designed for transient gene delivery to create transgene-free iPSCs. These IPSCs will be differentiated into hematopoietic cells to determine the best adult cell type and reprogramming vectors for creating iPSCs with hematopoietic potential. Adeno-associated virus gene targeting vectors will be used to correct the globin mutations in these thalassemic IPSCs, and globin expression will be studied after their differentiation into erythroid progeny. This research plan capitalizes on recent advances in the derivation of patient-specific stem cells, which in combination with gene correction constitutes a new paradigm for the treatment of genetic diseases.